The situation: You are tasked with completing the analysis for a special order request you have received from the Doha Annual Book Festival to produce a series of posters. The festival would like to pay QAR 287,500 for 2,500 posters. The Poster Company has the capacity to print these posters, but the order would put them at maximum production capacity of 10,000/month. Custom poster price (QAR) Variable costs MFG Labor (QAR) Material Marketing Total variable costs Fixed costs MFG Marketing Total fixed costs Product Information (QAR) 225 375,000 300,000 187,500 862,500 275,000 225,000 500,000 Required: 1. Calculate the average cost per unit. 2. Calculate the operating profit if the Poster Company accepts the special order. ( 3. Do you recommend that the Poster Company accept the special order? Provide justifications for your answer and address any doubts about taking it. Write in your own words. Answer in either Excel or Word. Maximum answer should be 100-200 words

The situation: You are tasked with completing the analysis for a special order request you have received from the Doha Annual Book Festival to produce a series of posters. The festival would like to pay QAR 287,500 for 2,500 posters. The Poster Company has the capacity to print these posters, but the order would put them at maximum production capacity of 10,000/month. Custom poster price (QAR) Variable costs MFG Labor (QAR) Material Marketing Total variable costs Fixed costs MFG Marketing Total fixed costs Product Information (QAR) 225 375,000 300,000 187,500 862,500 275,000 225,000 500,000 Required: 1. Calculate the average cost per unit. 2. Calculate the operating profit if the Poster Company accepts the special order. ( 3. Do you recommend that the Poster Company accept the special order? Provide justifications for your answer and address any doubts about taking it. Write in your own words. Answer in either Excel or Word. Maximum answer should be 100-200 words

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter17: Activity Resource Usage Model And Tactical Decision Making

Section: Chapter Questions

Problem 18E: A company is considering a special order for 1,000 units to be priced at 8.90 (the normal price...

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